Lecture 8 Flashcards
1
Q
Brand options
A
- National Brand / Manufacturer’s Brand
- Store brands / Private-label brands / House brand / Own brand
- Generic Brand
2
Q
National Brands / Manufacturer’s Brand
A
- Products are designed, manufactured by a vendor and sold to many different retailers.
- Vendors responsible for developing, producing with consistent quality and having marketing campaigns to establish brand image.
3
Q
Store brands / Private-label brand / house brand / owned Brand
A
- Products developed by retailers
- They develop design and contact manufacturers to produce these products.
Pros:
Build customer loyalty through unique merchandise
Difficult for customers to compare price with competitors
Improve margins - 5% to 10% or higher
Gives store distinct image
4
Q
Generic Brands
A
Labelled with name of commodity, no brand name to distinguish.
Targets price-sensitive segment by offering no-frills product at discounted price
5
Q
How do retailers choose between store brand / national brands
A
- Store brand can enhance and expand assortments
and is of better value - Profitability
(National brands are a double edged sword)
- Customers that developed loyalty to national brands will want the brand in retailer’s store, otherwise customers might view its assortments as lower in quality, reducing in profits.
- Since there is consistency in national brands it is easy to compare between retailers for better prices. - Flexibility
A strong national brand can dictate how retailers display and advertise.
6
Q
Costs associated with global sourcing decisions
A
- Country of Origin effects
- Foreign currency fluctuations
- Tariffs
- Costs in changing inventory
- Transportation costs
- Lead time
7
Q
Legal, ethical and socially responsible issues for buying merchandise.
A
- Counterfiet
- Commercial bribery
- Exclusive dealing agreements
- Tying contracts
- Supplier practices
